263 F. Supp. 79

Mina BULLARD, Plaintiff, v. RHODES PHARMACAL CO., Inc., Defendant.

No. 1394.

United States District Court D. Montana, Missoula Division.

Jan. 23, 1967.

*81Goldman & McChesney, Missoula, Mont., for plaintiff.

Garlington, Lohn & Robinson, Missoula, Mont., for defendant.

OPINION AND ORDER

RUSSELL E. SMITH, District Judge.

The defendant corporation was served with summons and complaint in this diversity action pursuant to Rule 4(d) (7), Fed.R.Civ.P., and Rules 4D(2) (f) and 4D(6) (a) Mont.R.Civ.P.

It now contests the jurisdiction of this court on the grounds that the exercise of in personam jurisdiction over it pursuant to the Montana rules violates the due process clause of the Fourteenth Amendment.

The defendant is an Ohio corporation with its principal place of business in Chicago, Illinois. It manufactures a hair styling lotion called “Jon-James Perform” which the plaintiff, a Montana citizen, purchased in Montana and which, she claims, caused damage to her respiratory system. The defendant, by affidavit of its president, indicates that it maintains no office in the State of Montana; that it has no representative resident in or assigned to Montana; that any orders received from wholesale or retail outlets located in the State of Montana have been received by Rhodes Pharmacal in Chicago, Illinois, accepted by the said company in Chicago, Illinois, and shipment made by common carrier from Chicago, Illinois, to the State of Montana; and that the total amount of business of Rhodes Pharmacal Company in the State of Montana consists of less than one-half of one per cent of its total business.

Whether the defendant’s activities were of such a character to subject it to personal jurisdiction under Montana’s “long arm statute”1 requires determination of two issues: 2 (1) Were the defendant’s activities such as to fall within the scope of Montana’s Rule 4B (1) (b);3 and (2) if they were, does the exercise of in personam jurisdiction, in light of those activities, offend the due process requirements of “fundamental fairness” embodied in the “minimum contacts” test of International Shoe Company v. State of Washington, 326 *82U.S. 310, 66 S.Ct. 154, 90 L.Ed. 95 (1945).4

Subdivision (b), unlike many states’ long arm statutes, does not require that the tortious act occur in Montana, but only requires that the act result in the “accrual within this state of a tort action.” 5 Clearly the complaint alleges the commission of an act by the deféndant — whether it be negligent manufacture or a failure to adequately warn —which resulted in plaintiff’s injury in Montana and, consequently, the accrual of a tort action in Montana. The defendant’s activities were of such a nature to fall within the scope of Rule 4B(1) (b).

Now posed is the second question— whether the Montana statute as thus applied offends the due process clause of the Fourteenth Amendment.

If the defendant has “certain minimum contacts”6 with the forum state “such that the maintenance of the suit does not offend ‘traditional notions of fair play and substantial justice’ ” 7, due process allows the forum state to subject it to in personam jurisdiction in actions that “arise out of or are connected with the activities within the state * * 8 “The application of that rule [requirement of contact with the forum state] will vary with the quality and nature of the defendant’s activity, but it is essential in each case that there be some act by which the defendant purposefully avails itself of the privilege of conducting activities within the forum State, thus invoking the benefits and protections of its laws.” 9

These are the standards by which Montana’s exercise of jurisdiction must be tested. No precise definition of the “minimum contacts” sufficient to satisfy due process has been formulated.10

The existence of contacts necessary for the constitutional exercise of personal jurisdiction must be determined upon the facts of each case. Perkins v. *83Benguet Consolidated Mining Co., supra, at page 445 of 342 U.S., at page 418 of 72 S.Ct.

The Supreme Court in International Shoe Company v. State of Washington, supra, at page 319 of 326 U.S., at page 160 of 66 S.Ct., said the test of due process is not dependent upon the quantity of the defendant’s contacts with the state; but, “Whether due process is satisfied must depend rather upon the quality and nature of the activity in relation to the fair and orderly administration of the laws which it was the purpose of the due process clause to insure.” It is true that in terms of percentage of its total sales, defendant’s contacts with Montana were slight. It is however fairly inferable that these contacts were limited only by the lack of demand in Montana for defendant’s products. It is fairly inferable that defendant’s intention to do business in Montana was a general intention, and that to the extent there was a demand defendant intended to sell in Montana. Given this state of mind which defendant was free to alter, had defendant felt that the products liability climate of the state or its long arm statute would be burdensome to it, is it unfair to treat as the required “minimum contacts” this intention plus the fact of the sales? This approach is suggested. by the International Shoe case, supra, which rejects quantity of sales as a measuring rod.11 It also satisfies the “purposeful act” requirement of Hanson v. Denckla, supra. Certainly a defendant should not be subjected to the jurisdiction of a distant state by accident, but when from the general pattern of its business it may be said that it contemplated a general products distribution in a state it does not seem unfair to require that it defend its products’ liability cases arising in that state.12

The defendant’s motion to dismiss is denied and it is granted twenty (20) days within which to further plead. However, for the benefit of the defendant if it wishes to appeal, the court is of “the opinion that such order involves a controlling question of law as to which there is substantial ground for difference of opinion and that an immediate appeal from the order may materially advance the ultimate termination of the litigation. * * *.”13

Bullard v. Rhodes Pharmacal Co.
263 F. Supp. 79

Case Details

Name
Bullard v. Rhodes Pharmacal Co.
Decision Date
Jan 23, 1967
Citations

263 F. Supp. 79

Jurisdiction
United States

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